asked the Secretary of State for Defence what information he has concerning the number and total value of defence contracts which are allocated largely on the basis of the hourly rate of contractors.
This information could not be provided without disproportionate time and effort.
asked the Secretary of State for Defence what steps are taken by his Department to verify the number of hours spent by contractors on work allocated solely or largely on the basis of the hourly rate of the contractor or contractors.
Verification of the hours spent is normally undertaken by the appropriate Ministry technical authority in conjunction with the relevant contracts branch.
asked the Secretary of State for Defence what is his policy on the allocation of defence contracts to suppliers based solely, or largely, upon the hourly rate of the contractor or contractors.
The practice of pricing on an all-up hourly rate covering both labour and other expenses is not a practice applied extensively in MoD contracting. It is normally adopted only for contracts covering primarily the provision of manpower effort. Many of these contracts are of relatively low value. The work could, for example, involve research, minor development work, repairs and servicing, and ADP effort. Hourly rates are usually agreed in advance, where possible, following competitive tendering.